LPS Scope question/maybe problem

Ok, this is my second time shooting my PSL rifle. Ive got the standard 4x24 LPS scope. I have zeroed it at 100m with the knobs looking like so:
correct? ok moving on.
So i brought it out to about 375~400 meters and adjust the elevation to 4, and windage to 3 in the black. Was hitting about 5 FEET up and to the left.
I thought for range you need to compensate for the scopes offset positioning?
Anyways, i messed with it and was hitting with these settings:

Got 3/10 hits on a 8.5x11 sheet of paper. I think all the others went to the left because none hit the paper to the right of that one.

So heres the question. Do i need to compensate for the scopes offset or no? And why is my elevation knob slightly off?